House Republicans: Poised to Push U.S. Off Fiscal Cliff and GOP Off Political Cliff? (UPDATED)

Here we go again. Only the economic and political impact may be greater this time. The unthinkablethinkable is about to happen: it’s 2013 and already deja vu. Conservative House Republicans, championed by House Majority Leader Eric Cantor (R-VA), seem poised to effectively reject the Senate’s bipartisan fiscal cliff deal which will hurl the U.S. off the fiscal cliff — and the Republican Party off the political cliff.

And (oh yes) Cantor will once again seems ready to effectively undercut House Speaker John Boehner, who many believe would support the Senate deal. News reports now suggest there’s a good chance the House will not pass the deal, send it back to the Senate — and off the cliff the U.S. goes. And one report stresses the impact of Cantor’s strong opposition.

If the GOP doesn’t offer an up or down vote on the Senate deal, well, that would kill the deal, too.

And then what? “Well, I say that then we wait for the new Congress to come in on Thursday. We’ll have better numbers, more members on our side,” said Clyburn. “Then we offer a new bill that they will like even less. They didn’t like the 450 (thousand dollar in household income) floor on the tax increase? Let’s see how much they like it when we push it back down to 250 (thousand)!”

On the other hand, the deal is substantively better than going over the cliff and having all income and investment taxes go up, and having the defense sequester hit right away. And politically, Republicans are escaping with a better outcome than they might have expected, and President Obama has gotten relatively little at his moment of greatest strength. In particular, this should do it for new tax revenues, at a number lower than Speaker Boehner originally offered—and it should be pretty easy to have the next debate focus on spending and entitlements.

So, enough House Republicans should vote yes to get the bill passed. And then immediately move on. For Republicans and conservatives need to get serious about what, substantively, they want to stand for over the next few years; about what, practically, they think they can accomplish during Obama’s second term; and about what, politically, their strategy and tactics are for dealing with President Obama and for laying the groundwork for victories in 2014 and 2016. This is the task for the new year, once we get past this dog’s breakfast on New Year’s Day.

But it sounds as if the House is ready to hurl political savvy to the winds, make a statement, and (further) brand the Republican Party as a party whose most non-compromising conservative faction seems in firm control and willing to use any and all power it has to thwart more moderate conservative Republicans, the will of most members of Congress and the general electorate.

The bipartisan agreement struck in the Senate to avoid the worst effects of the “fiscal cliff’’ ran into strong opposition in the Republican-controlled House on Tuesday, with GOP members criticizing the deal for raising taxes without cutting spending.

Eric Cantor (R-Va.), the influential House majority leader, emerged from a two-hour meeting with GOP colleagues and said he opposes the Senate bill, which would let income taxes rise sharply on the rich. Rep. Jeff Flake (R-Ariz.) said Cantor “forcefully” expressed his concerns during the closed -door session, during which other GOP members expressed grave doubts about the agreement.

Cantor’s opposition likely dooms the chances for fast House passage of the legislation without changes, which could prolong efforts to avert the automatic tax increases and spending cuts that technically took effect on Tuesday. If there is no agreement by the end of the current Congress at noon on Thursday, negotiations would have to start over in the next Congress. Many economists believe that the fiscal cliff’s full effect would drive the economy back into recession.

The agreement, crafted by Vice President Biden and Senate Minority Leader Mitch McConnell (R-Ky.) and approved by the Senate in a highly unusual New Year’s morning vote, primarily targets taxpayers who earn more than $450,000 per year, raising their rates for wages and investment profits. At the same time, it would protect more than 100 million households earning less than $250,000 a year from income tax increases scheduled to take effect Jan. 1.

The deal came together barely three hours before the midnight deadline, after negotiators cleared two final hurdles involving the estate tax and automatic spending cuts set to affect the Pentagon and other federal agencies this week.

But the House’s initial negative reaction threatened to plunge Washington back into the high-stakes, last-minute drama that has characterized both the fiscal cliff negotiations and a series of other recent confrontations between the two parties over spending and taxes, including last year’s fight over raising the federal borrowing limit.

A rift at the highest level of House Republican leadership is imperiling Senate-backed legislation to yank the economy back from over the fiscal cliff — legislation that House Republicans directly asked their GOP counterparts in the Senate to negotiate and pass.

Now, with hours to go before the end of the 112th Congress, the GOP must find a practical way around the impasse, or test House Speaker John Boehner’s commitment to squashing legislation that lacks the support of more than half of his conference.

Many House Republicans are angry that the Senate bill, which passed overwhelmingly just after 2 a.m. Tuesday morning, includes no net spending cuts — even though it raises over $600 billion in revenue from affluent taxpayers over 10 years. They want to amend the bill and send it back to the Senate, effectively killing it and leaving the new Congress to figure out how to roll back major austerity measures that are already kicking in.

And they have support from House Majority Leader Eric Cantor (R-VA).
Republican aides, and GOP members leaving a Tuesday afternoon GOP conference meeting, confirmed that Cantor expressed opposition to the Senate bill in his current form. And according to both opponents and reluctant supporters of the legislation, an campaign is mounting to tack spending cuts on to the legislation and send it back to the Senate.

I’ll be shocked if this isn’t sent back to the Senate,” Rep. Spencer Bachus (R-AL), chair of the House Financial Services Committee, told reporters after the meeting.

“I think that they’re heading in that direction,” said retiring Rep. Steve LaTourette (R-OH), a Boehner ally who said he’d likely support the legislation in its current form. “I think the overwhelming sentiment was that we needed to at least address spending, somehow, through an amendment. There were more than just one or two people who said that we should just take it and go home, but I don’t think that’s a majority sense.”

GOP leadership entered a huddle after a meeting to decide how to proceed. But offering recalcitrant Republicans anything other than a fig leaf will doom the bill, Democrats say.

They’ll have no difficulty making life uncomfortable for Senate Minority Leader Mitch McConnell (R-Ky.), who they blame for getting them in this mess, said one GOP source close to the situation. “He jammed the House. He’s gonna get re-jammed,” he said of the possibility the House amends the bill and sends it back to the Senate.

But if House Republicans think they can put the onus back on the Senate by amending the bill, they are wildly mistaken, a Democratic Senate aide involved in the talks said. “They are full of hot air. Not a chance we come back,” he said.

Following the GOP meeting, Democratic and Republican leaders conferenced by phone to swap notes, trying to determine who has what votes. Democrats think they can get 140-150 members of their caucus, but are not sure that the GOP side can get enough votes to pass the Senate deal. Neither are the Republican leaders. Democrats don’t want to be blamed for going over the cliff, but GOP Tea Partiers may see it as an act of courage to do so.

“It may go back with, as someone said, not a poison pill, just enough to give ‘em a little heartburn and get it done,” said Rep. Bob Turner (R-N.Y.)

The biggest complaint is the lack of spending cuts.

“We’ve got to provide responsible spending balance long-term,” said Rep. Nan Hayworth (R-N.Y.) “This bill does not do that.” Republicans who filed out of the House GOP meeting sounded cautionary notes about the fiscal cliff deal, suggesting it faces serious trouble.

House GOP sources said that Rep. Paul Ryan (R-Wisc.), a leader of the conservative wing and a potential threat to House Speaker John Boehner, is expected to vote against the Senate deal if it comes to the floor, breaking the leadership unity that existed around Boehner’s “Plan B.” And Republicans leaving the meeting said that Majority Leader Eric Cantor (R-Va.), Boehner’s leading rival, spoke against the bill, BuzzFeed’s John Stanton reported.

Rep. Steve LaTourette, a Boehner ally, said there were “two schools of thought” expressed in the meeting: To accept the deal and “live to fight another day,” or amend the measure and send it back to the Senate.

The latter option clearly enjoyed support from the majority of the conference.
“I think it’s moving in that direction,” LaTourette said.

Still, Cantor’s decision to come out against the agreement was unexpected.

According to one Republican in the room Cantor “went rogue on the messaging” and clearly caught his colleagues in leadership by surprise with his decision to come out against the bill.

Technically, the agreement was not yet dead: Speaker John Boehner could, in theory, still find the votes to pass the bill. But Boehner’s control of his conference is practically non-existent at this point and there is virtually no chance he can marshal the 120 Republicans he insists he needs before passing the bill.

Given those dynamics, it now seems increasingly likely that Boehner will opt to bring the bill to the floor and allow his members to amend it in some way before sending it back to the Senate for another vote. If they fail to reach agreement, a new Congress sworn in on Thursday would have to start from scratch.

And a move to amend the bill in the House will mean the effective end of the Biden-McConnell deal, since neither Senate Democrats or Republicans are in any mood to take another vote on a bill, and any changes House Republicans make are likely to be poison pills for Democrats.

When asked what a next step would be for the Senate were the deal to be amended by
the House, a Senate Democratic leadership aide responded: “Nothing. We’re done.”

And get ready for GOPers, talk radio hosts, and their pundit allies to blame everything on (get ready for the surprise): the Democrats.

Shortly after House Republicans concluded their meeting, the conference prepared to blamed Senate Democrats for the death of a deal.

“The House will work its will, and if it sends the Senate an amended bill and Democratic leaders choose to go over the cliff, then they will have to answer to the American people,” a House Republican leadership aide said.

Prediction: it won’t work that way.

Most analysts agree: the largest onus will fall on the Republican Party which will continue to have the image of a party dominated by obstructionist elements that will not agree to compromise, regardless of the consequences to the country. Polls showed this image hurt GOPers in 2012 and it’s likely to make the party’s serious branding problem — and performance in national elections — worse.

House Majority Leader Eric Cantor, the No. 2 Republican in the House, declared his opposition to the Senate-passed “fiscal cliff” deal today, potentially putting the deal in peril.

“I do not support the bill,” Cantor said walking out of a conference meeting in which House Republicans discussed the “fiscal cliff” deal passed in the Senate overnight.

A number of other House Republicans today expressed serious concerns about the lack of spending cuts in the Senate bill, CBS News’ Jill Jackson reports. Some GOP members said they would vote against the deal for that reason. The nonpartisan Congressional Budget Office released a report today estimating that the Senate bill would add $329 billion to deficits in 2013 and $3.9 trillion to deficits over the next 10 years, relative to current law.

“Don’t think this is a done deal,” one GOP aide warned CBS News early Tuesday afternoon.

Brendan Buck, a spokesman for House Speaker John Boehner, said after today’s first conference meeting that the lack of spending cuts in the Senate bill “was a universal concern amongst members in today’s meeting.”

“The Speaker and Leader laid out options to the members and listened to feedback,” Buck said. “Conversations with members will continue throughout the afternoon on the path forward.”

The problem: the House’s path forward increasingly sounds like its path backwards.

I wrote last week about why House Republicans engage in behavior that is collectively idiotic but individually rational. They’re at it again today. With a fiscal cliff compromise bill having passed the Senate early this morning by a vote of 89-8, House Republicans are now sending strong signals that they won’t go along….

…..To recap: The Plan B fiasco left Republicans opposing Democratic plans to avert the fiscal cliff and offering… nothing in return. After Plan B fell apart, Boehner said that the Senate would have to act first, and the House would consider what the Senate passed. Now, the Senate has acted with near-unanimous bipartisan support, and the House is poised to respond by rejecting that plan and offering… nothing, again.
This makes the Republican Party look terrible: irresponsible, incompetent, obstinate. You can expect the stock market to open sharply lower tomorrow and Republicans to take all the blame for the voluntary economic damage caused by the fiscal cliff.

But this course still makes sense from the perspective of individual Republicans in the House. Voting for Plan B, or for the Senate fiscal cliff deal, or even for an amended version of the Senate deal, can open a Republican incumbent to attacks from conservative primary challengers and anti-spending groups like FreedomWorks and the Club for Growth.

Opposing everything and offering no plan to avert the fiscal cliff won’t encourage such challenges from the right. And if you represent a reasonably safe seat — as the vast majority of Republican members do — boosting the party’s national vote share, or governing in the national interest, is apparently no competition for the instinct of political self-preservation.

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As I said in another post, I do not understand why everyone( Republicans) has conveniently forgotten the $1.5T in spending cuts Obama already made in 2011 with the Budget Act. That’s alot of money folks! There should be absolutely no more entitlement cuts…period. If the Reps can incessantly chant ” no more taxes” than the Dems are MORE than allowed after the BCA to chant ” no more cuts”.
The Reps got 450k as opposed to 250k, and so far no deductions or loopholes. Such a deal.
You cannot make these radical Tea Party nut jobs happy.